Slow growth in exports from O.C./L.A.

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Exports from Orange and Los Angeles countiesgrew to $75 billion in 2012, a year-over-year rise of 3 percent, the U.S. Department of Commerce said Thursday.

The Los Angeles-Long Beach-Santa Ana metropolitan area was the third-biggest exporter in the nation, after Houston and New York. However, the area's growth rate was below average: Among the top 25 metro areas, merchandise exports jumped 5 percent.

The region's export economy has recovered from a severe downturn during the recession, when exports dropped from $60 billion in 2008 to $51.5 billion the following year. Today, with the economy healing slowly, "Exporting is helping many businesses to survive in spite of the current economic situation," said Richard Swanson, Pacific South Network director for the department's U.S. and Foreign Commercial Service.

Mexico is the Los Angeles area's biggest trading partner, absorbing a quarter of the area's exports. Canada is second with 11.9 percent and China third with 9.7 percent. The Los Angeles area was the second-biggest exporter to Mexico, with $18.3 billion worth of goods, after Detroit. Los Angeles was fifth among metro areas in exporting to Canada.

Wallace Walrod, chief economic adviser to the Orange County Business Council, said the new data "validate what we are seeing and hearing here in Orange County – international trade opportunities are booming for O.C. companies."

Orange County exports are expected to grow from an estimated $25.5 billion in 2012 to $29.6 billion in 2014, he said, citing a forecast by Cal State Fullerton economists.

The county's larger export sectors include computer and electronics equipment, medical devices and aerospace parts, which flow through the ports of Los Angeles and Long Beach as well as through the region's airports, and on highways and rail lines to Mexico and Canada.

Jock O'Connell, international trade adviser for Los Angeles-based Beacon Economics, an independent research firm, said the Commerce Department's 2012 metro estimates "show that we are holding our own."

However, he added, more recent export data reveal a slowdown in California exports, which dropped to $72.3 billion during the first five months of 2013 from $73.3 billion the year before.

The dip is unsurprising, O'Connell said, given "a deterioration of trade globally. Economic growth in China has slowed considerably. Major emerging markets which had shown promise, such as Brazil and India, are fairly wobbly. The European economy is in the doldrums."

He added, "The fact that California's exports are down is not necessarily alarming. It doesn't indicate anything wrong with the state's economy or the competence of its industry."

A substantial falloff in exports of personal computer components is the main cause of the drop. In the past three months, the state's exports of those items fell 22 percent from a year earlier.

"Surging worldwide consumer demand for smartphones and tablets has led to a dramatic restructuring of global supply chains in the electronics components sector," O'Connell noted.

The Commerce Department statistics for metro areas do not exactly coincide with the export output of local factories because they are based on the ZIP code of the shipper, he said.

"It is a squishy number. A disproportionately large share of export trade is attributed to metro areas that are near major hubs, such as the ports and LAX," O'Connell said.

"Agricultural exports are attributed to companies in Manhattan, where they don't grow a lot of soybeans. Michigan auto parts sent to China are arranged by a trading company in Los Angeles and then counted as an LA export," he said.

Nonetheless, with the same data measured year to year, he said, "You can identify trends. We know we are exporting more than last year, and that is an important conclusion."

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